Last week, I asked wolfy if I should start digging into the TRUTH abou the oil sands in Albert. I figure it is just another of those big fat CON jobs ...
Where is this technology to .. be developed .. to be exploited ..
How are all these folks flooding into and around Calgary going to survive on some mighty slim pickings in social services department, too few schools and doctors, too many Crapacinno bars and late night clubs for Duppies (dual income nincompoops), not enough "parking lots" and a VERY VERY VERY strange (to my mind) cultah.
But back to the left brained stuff .. what spin is Harper going to put on the strange goings on that will take place as people push and shove their way(s) around the oil game ...? Hunh? Whadda ya think ...?
So may be this is the first part of a series, Maybe I am already fed up with the whole fiasco to come. Dunno for SURE about this at all and I don't know what I am going to do with what I find out.
But here is something to chew on.
And don't fret, my peak oil buddies! We have NOT forgotten the Russian oil alerts. They are just too fascinating for Wordz ....
Refinery advances oil sands strategy
CALGARY —
Husky Energy Inc. has trumped competing bids to land
Valero Energy Corp.'s
165,000-barrel-a-day refinery in Lima, Ohio, for $1.9-billion (U.S.),
plus net working capital, narrowing the available options for firms
seeking to bring crude from Alberta's oil sands to market.
The deal, expected to close by the end of the second quarter,
effectively allows Husky to advance its ambitious oil sands development
plans, as it provides a refining home in the U.S. for the firm's future
crude output. However, it also increases the stakes for companies that
haven't tied up a downstream solution for their oil sands projects,
with the number of U.S. refineries available decreasing and the cost of
building an upgrader in Alberta soaring.
“The acquisition of the Lima refinery represents a significant step in
Husky's ongoing strategic move of expanding our downstream business,”
Husky chief executive officer John Lau said in a press release.
“Integration of the Lima refinery with future growth of heavy crude oil
and oil sands production is part of Husky's long-term strategy to
enhance returns to shareholders.”
Husky, which produced 360,000 barrels of oil and gas a day in 2006,
expects to extract 500,000 barrels of crude a day from its oil sands
operations alone by 2020, with the 200,000-b/d Sunrise development
expected on stream in 2010. However, because oil sands crude is heavy
and difficult to refine, the firm – like other Canadian producers –
needs to find refineries to process its extra output in order to bring
it to market.
With the refinery previously valued between $1.5-billion and
$2-billion, the deal is positive for Husky, especially in the wake of
spiralling prices within Alberta, said Adam Zive, a Toronto-based
analyst at Desjardins Securities.
“This deal compares favourably to similar recent deals and makes a lot
of strategic sense for Husky,” he said. “The highest value proposition
for a company with oil sands production is buying a U.S. refinery and
converting it to take the heavy crude.”
While the refinery acquisition will allow Husky to process crude from
Sunrise, it won't meet all the company's future refining requirements
and so the firm will still consider other options, including expanding
its 77,000-b/d Lloydminster upgrader, Husky spokeswoman Tanis Thacker
said.
“This is a first step, not a complete solution,” she said.
While some Canadian producers are looking to build upgraders – which
make the heavy oil sands crude lighter, and therefore easier for more
refineries to process – in Alberta, the province's oil boom appears to
have made their development less economic than a U.S. solution. On
Tuesday, the increased costs claimed a casualty as oil sands developer
Synenco Energy Inc.
said the upgrader portion of its Northern Lights project would now cost
$6.3-billion (Canadian), more than triple the estimated 2005 capital
cost of $1.9-billion, and it halted work on the facility because of the
new estimates.
Canadian producers
Western Oil Sands Inc. and Suncor
Energy Inc. are believed to have unsuccessfully bid on the Lima
refinery. Suncor CEO Rick George said last week that while the firm was
still searching for U.S. assets, the current asking price for
refineries is “too high.”
While a potential partner for Canadian producers is Houston-based
Marathon Oil Corp.,
which has been vocal about seeking a swap of its refining equity for a
stake in the oil sands, other potential deals seem thin on the ground.
BP PLC,
which holds major refining assets in the U.S. that could process more
Canadian crude, has a long-standing policy of non-involvement in the
oil sands and currently appears uninterested in a possible asset swap.
Question of the Day
(for newbies to this blog only ....)
What does British Petroleum KNOW that the others don't?
Hmmmmmmmmmmm....?
Technorati Tags: Alberta oil sands, Husky Energy, Valero Energy Corp., Synenco Energy Inc., boondoggles, urban crises to come
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